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LANDOWNER NEWSLETTER: USDA'S RECORD FARM INCOME FORECAST BULLISH FOR LAND VALUES
Feb. 22, 2013
LandOwner newsletter reports:
USDA's first call on 2013 ag income paints a bullish picture for farmland values.
The agency's Economic Research Service (ERS) forecasts 2013's net farm income will reach $128.2 billion, a 14% increase versus 2012.
USDA also notes that after adjusting for inflation, 2013's forecast level is expected to be the highest since 1973.
USDA's forecast includes the assumption the 2013 corn crop will return to trendline yields. That may be somewhat of a heroic assumption considering the extensive drought in the western Corn Belt. But with that assumption, USDA sees a substantial rise in year-end crop inventories.
That, in turn, leads to higher net farm income since this measure goes beyond cash income to include the value of inventory change and other non-cash items.
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